The biggest concern that brings most merchants to payment gateway comparison is the balance of three P’s: People (1), Payments (2), and Pricing (3).
E-retailers seek to partner up with a reliable bank & a secure tech solution (1) to authorize and settle payments smoothly both for a customer and for the merchant (2) at a low cost (3).
To combine three factors into a powerful combo, you’ll need to do quite a lot of homework on online payment gateway comparison and their fees — something neither ecommerce newbies nor busy entrepreneurs can’t afford while discussing more important business issues on the table.
If you can’t make heads or tails of payment processors, this article is for you. At Elogic, we’ve dealt with hundreds of payment gateways over the past 10 years and can surely tell the difference between them. Read on to find how to choose the right payment gateway and see the top ecommerce payment gateway comparison.
Before getting down to payment gateway providers comparison, better sit down at the negotiation table with your ecommerce team and set your expectations from a payment gateway.
Here are the questions you should answer when selecting a payment gateway.
The first thing you should keep in mind for the payment gateway comparison is hosting.
A hosted or third-party gateway means your customers are redirected from your website to a secure page where they can enter their credentials (for example: PayPal). Once the payment is processed, the customer is redirected back to confirm the order and continue with checkout.
In an integrated gateway, your customers won’t have to leave your website to type in payment info and to place orders. This generally requires an SSL certificate, which is the standard encryption method to ensure the customer’s data is secure.
A hosted gateway is easier to integrate because the provider is fully responsible for security. On the other hand, with an integrated gateway, you have more control. You keep your branding, and customers don’t have to navigate away from your site.
Reputation is everything. If you choose a payment gateway users aren’t familiar with or decide to skip the SSL certificate, don’t be surprised to see exorbitantly high cart abandonment rates.
Ecommerce shops that grossly neglect security and endanger user privacy and data have low customer trust and, hence, decreased conversion rates. Bottom line.
Small businesses should be particularly interested in a bundled merchant account when they compare online payment providers. The reason is quite obvious: with bundled accounts, you generally pay lower monthly fees.
If your business already has a merchant account and you want to connect it to your gateway of choice, make sure your current merchant account is compatible with the gateway.
A very important consideration is cost. Since you incur most of the fees, your choice of payment gateway should heavily depend on the fee structure (scroll down for a detailed payment gateway cost comparison). Generally, fees can be divided into two parts: monthly and per-transaction fees. Monthly fees are based on the cost of a subscription, and transaction fees can be either fixed or variable.
Some payment gateways like PayPal Pro and Authorize.Net charge a small monthly fee (<$30) in addition to a per-transaction fee, which can add up if you extrapolate over the course of a fiscal year.
Additionally, you should look into volume discounts if your business handles a high volume of sales/orders. More often than not, payment gateway providers do not explicitly state what these discounts are, so you may need to give them a call to find out.
With this information in hand, let’s compare payment gateway services.
Pricing plans depend on your business requirements, so we would recommend either sifting through payment gateway rates comparison or consulting experts.
At a glance, all of these gateways look very similar but they differ in their applications.
|Payment Gateway||Hosted or integrated||Requires SSL||Bundled Merchant Account||Transaction Fee||Currency||Supported Platforms|
|PayPal Standard||Hosted||No||Yes||2.9% + $0.30 per transaction||25||ALL. Since PayPal usually redirects to its own site, no platform integration is necessary.|
|PayPal Pro||Integrated||Yes||Yes||2.9% + $0.30 per transaction||25||ALL.|
|Authorize.Net||Integrated/Hosted||Yes||No||2.9% + $0.30 per transaction||11||Shopify, Volusion, Bigcommerce,WordPress, Magento, and more.|
|2Checkout||Integrated/Hosted||No||Yes||3.5% + $0.35 per transaction||87||Bigcommerce, Magento, Spree Commerce, WooCommerce, Shopify, and more.|
|Stripe||Integrated/Hosted||Yes||Yes||2.9% + $0.30 per transaction||100+||Shopify, WooCommerce, Magento, Bigcommerce,Spree Commerce, and more.|
|Braintree||Integrated/Hosted||Yes||Yes/No (depending on plan)||2.9% + $0.30 per transaction||130+||Magento, Spree Commerce, Bigcommerce,WooCommerce, Shopify, and more.|
|WePay||Hosted||Yes||No||2.9% + $0.30 per transaction||1||Bigcommerce, Magento, Spree Commerce, WooCommerce, Shopify, and more.|
|Square||Hosted||Yes||No||2.9% + $0.30 per transaction.||1||Bigcommerce, Shopventory, Weebly,Magento, and more.|
Supported currencies: 25 currencies in 200+ countries.
Transaction fees: 2.9% + $0.30 for US transactions, and 3.9% plus a standard fee for international payments.
In all online payment gateway comparisons, PayPal stands as the most popular provider in the market. Its name is synonymous with excellent customer service, quick transfers, and the highest conversion rates when compared to other payment types.
The vendor offers two solutions for ecommerce merchants: PayPal Standard and PayPal Pro.
Supported currencies: 7 currencies in 8 countries.
Transaction fees: 2.9% + $0.30 transaction fee or 3.5% + $0.15 transaction (depending on the type of transaction).
In this payment processor comparison, Square stands as the best option for retailers who sell both online and offline. It essentially turns your customers’ devices into a point-of-sales (POS) terminal. The payment processor reads your users’ credit cards on a smart device or allows you to manually enter credit card details in-person or via the phone.
The main benefit of Square is that it’s incredibly easy to set up and use. You can either install it as a plugin or cut and paste a snippet of code to create a checkout right on your website.
As far as the Square pricing is concerned, there are no hidden fees, like setup, authorization, refund, PCI-compliance, business card, etc. However, you will incur 2.9% + $0.30 transaction fee (in case of Square invoices, APIs, and card-on-file payments) or 3.5% + $0.15 transaction fee (for manually entered credit cards on POS and online).
Supported currencies: 135+ currencies in 46 countries.
Transaction fees: 2.9% + $0.30 transaction fee.
While Square excels in mobile payment processing, Stripe is geared towards ecommerce payment processing. The biggest draw of Stripe is its free and flexible API.
Stripe payment processing platform is developer-oriented, thus, allowing a merchant to build a custom checkout experience. This might be problematic for startups who have no in-house tech team or can’t afford to hire an ecommerce developer; still, mid-sized and large businesses will find Stripe customization tools useful to meet their complex and specific ecommerce needs.
Unlike other providers in this payment gateway comparison, Stripe charges no monthly fee and offers a standard 2.9% + $0.30 fee for handling online credit card transactions. Note that Stripe accepts all kinds of payment methods, except PayPal.
Supported currencies: 130+ currencies in 28 countries
Transaction fees: 2.9% + $0.30 transaction fee.
Despite being a subsidiary of PayPal, Braintree is hard to miss in an ecommerce payment gateway comparison. It includes built-in PayPal Express Checkout functionality and supports non-hosted custom checkout at no extra cost.
Besides, the major strength of Braintree is that it supports payments from a variety of web wallets, like Google Pay and Apple Pay. A free API allows a merchant to smoothly integrate the checkout directly and preserve the aesthetics and brand identity of the store.
When it comes to payment gateway price comparison, Braintree will charge you a silent industry standard of 2.9% + $0.30 per transaction. No monthly fees apply.
Insider tip: if you choose to integrate both PayPal and Braintree into your store checkout, don’t turn one Express Checkout functionality on both providers. Otherwise, the two versions will conflict with one another.
Supported currencies: 3 currencies (USD, Euro, and Canadian Dollar) only in the US.
Transaction fees: 2.9% + $0.30 per transaction.
In this ecommerce payment gateway comparison, WePay wins a prize as the best option for SaaS companies, fundraisers, and startups in the US. It preserves all the functionalities of PayPal, plus adds a flexible API for merchants to integrate the checkout right into their store. It’s also praised for its security features offering the service of fraud and risk protection.
WePay doesn’t handle big transaction flows, but it’s not the biggest downside of WePay, though. The platform requires small businesses to work with WePay partners (JPMorgan Chase being one of the few) to accept payments within your platform.
The transaction fee is pretty standard (2.9% + $0.30 per transaction), and no setup or monthly fees apply.
Supported currencies: 10+ currencies in 30+ countries.
Transaction fees: setup fees + 2.9% + $0.30 per transaction.
Authorize.Net has been around since 1996. Their seniority in the payment gateway market is a sign of reliability and security. It offers the Advanced Fraud Detection Suite to identify and prevent fraudulent transactions as well as a developer API to customize your payment experience with a mobile-optimized solution. The platform also gives you the option of connecting your own merchant account.
However, Authorize.Net loses in the payment gateway fees comparison as it doesn’t have any features that differ greatly from other more affordable options. In addition to the standard 2.9% + $0.30 transaction fees, a merchant would have to pay a $49 setup fee + $25 per month.
Supported currencies: 100+ currencies in 234 countries.
Transaction fees: 3.5% + $0.35 per transaction.
2Checkout is one of PayPal Pro’s main competitors in this online payment gateway comparison. Their latest version offers an all-in-one monetization platform that can handle simple transactions, subscription-based products, and digital goods. Like PayPal, 2Checkout supports multiple currencies all around the world.
Still, watch out for some caveats in payment gateway charges comparison:
The higher fees are justified by extra features of 2Checkout that its cheaper competitors don’t offer. That’s why large enterprises choose to work with 2Checkout.
The cost is often the primary factor while choosing a payment gateway. Some merchants are driven by a penny saved-a penny earned strategy. Others are looking for a good value for the price.
Here’s a recap of the payment processor fees comparison discussed in this article:
|Payment gateway||Setup/monthly fees||Transaction fees||Chargebacks||Famous users|
|PayPal||$0 for PayPal Standard$30 monthly fees for PayPal Pro||2.9% + $0.30 per transaction in the US 3.9% plus a standard fee for international payments||$20||Adidas, IKEA, Roller Rabbit|
|Stripe||$0||2.9% + $0.30 per transaction||$15||The British Council, Papier, Missguided|
|Braintree||$0||2.9% + $0.30 per transaction||$15||Casper, Eventbrite, Nokia, Skyscanner|
|Square||$0||2.9% + $0.30 per transaction.||$0||Velvet48, Stumptown Coffee Roasters, Rire|
|WePay||$0||2.9% + $0.30 per transaction||$15||Classy, Keap, YouCaring|
|Authorize.Net||$49 setup fee + $25/month||2.9% + $0.30 per transaction||$25||FurniturePick, Fork Over Knives, PMT Online|
|2Checkout||$0||3.5% + $0.35 per transaction||$15||Malwarebytes, HP, ABBYY, Canon|
Your choice of payment gateway for your store will stem from your business requirements. That’s the main takeaway from this payment gateway comparison. Whether you’re looking for security, cost-effectiveness, or smooth checkout integration, you should choose the one that serves your business interests.
Let us only give you a few final recommendations before you leave:
Last but not least, you can take advantage of the payment gateways previously integrated with your ecommerce platform. Consider Magento: it supports PayPal, Braintree, and Authorize.Net out-of-the-box, plus has a flexible API to integrate any other payment solution.